Accounts Committee to probe abuse of funds

The Public Accounts Committee (PAC) of Parliament says it will summon district commissioners (DCs) in councils where about 20 legislators are accused of misappropriating the Constituency Development Fund (CDF).

In an interview yesterday, PAC chairperson Alekeni Menyani confirmed about the impending probe.

He said: “The concerned DCs are expected to appear before the committee during the first or second week of August 2017.”

PAC’s move comes hot on the heels of an Anti-Corruption Bureau (ACB) decision to probe the same abuse. Previously, the ACB has also arrested some council officials, including DCs, on suspicion that they embezzled CDF and other grass roots development funds—Local Development Fund (LDF) and District Development Fund (DDF).

Minister of Finance, Economic Planning and Development Goodall Gondwe told the budget meeting of Parliament in June this year that 20 members of Parliament (MPs) misappropriated K80 million of CDF in 16 district councils.

And a report on audit findings and recommendations by the Central Internal Audit Unit at the Ministry of Finance, Economic Planning and Development has indicated that MPs have abused eight percent of their CDF.

The audit covered a sample of about K1 billion utilised by councils in the 2014/15 and 2015/16 financial years to establish whether CDF was used for intended purposes.

The audit was also done to identify control weakness in CDF management and to make recommendations on how to address the identified weakness.

The report, based on a sample by the Central Internal Audit Unit, has revealed that about 16 councils, including Chitipa, Karonga, M’mbelwa (Mzimba), Nkhotakota, Dowa, Ntcheu, Mangochi, Machinga, Chiradzulu, Chikwawa, Nsanje, Neno and Lilongwe City abused the funds.

Further, the report indicates that in some cases the project materials were procured, but were not delivered in project sites and that there was no maintenance of stores registers, misprocurement of project materials, custody of project materials by MPs, failure to monitor projects by councils due to lack of project administration funding which is fully controlled by MPs, goods or services procured from MPs’ relations and procurements made by MPs instead of councils’ respective internal procurement units.

The report further reveals that initiation of projects by MPs was done without involving area development committees (ADCs) and without DCs’ approval as required by CDF guidelines.

But Menyani exonerated his fellow legislators, arguing that the MPs do not control finances at district level.

He said: “CDF is controlled by controlling officers through the accounts of government and not operated by an individual. The controlling officers are responsible for any amount of money missing from the accounts of government.

“The MPs have no case to answer. The DCs have a case to answer because they are the government controlling officers.

“The DCs are responsible for any mess. We want to pin them down to find out what was there between them and the members of Parliament.”

Menyani said CDF does not go straight into the legislators’ bank accounts, but into the councils’ bank accounts.

Among others, the auditors have recommended structural and operation changes in the management of the CDF, saying funds should be approved by full councils as is the case with other projects financed by other development funds to enhance transparency and minimise creation of ghost workers.

In a separate interview, Malawi Economic Justice Network (Mejn) executive director Dalitso Kubalasa said from their own public budget expenditure monitoring and tracking exercises, they came across the development funds’ anomalies, a development that mostly triggered calls for the council audits.

He said: “It is indeed apparent that there are serious compliance issues in the first place, in as far as the guidelines and ideals are concerned. Aside from this is also the fact that no effective monitoring mechanisms, apart from the ones being instituted rather in a more ad hoc manner by civil society, have been occasioned comprehensively by the councils and government at that level?”

However, Kubalasa indicated that the recommendations are similar to those made by his organisation aimed at strengthening the oversight functions of the full councils along with the key stakeholders, particularly the rights’ holders who need to be encouraged to fully own up and exercise their authority as major beneficiaries and real social accountability players. n